This week, the Reserve Bank of Australia (RBA) made the decision to hold interest rates at 4.1% – eliciting a sigh of relief from retailers and consumers alike.
The welcome move from the RBA on Tuesday comes after inflation data last week indicated that prices are back on a downward trajectory.
There’s no doubt that another interest rate hike would have further increased the cost of doing business and reduced revenue for retailers, so we’re pleased the RBA has taken a cautious approach this month.
The RBA remains coy about the potential for further interest rate hikes, but it has acknowledged the stabilisation of inflation thus far.
Next month, the Australian Bureau of Statistics (ABS) will be releasing quarterly inflation data – which will be influential in next month’s cash rate decision.
The industry will be watching with great interest and trepidation.
Speaking of the ABS, last week saw the release of retail trade data for May 2023 and the quarterly job vacancies figures.
Year-on-year retail sales grew 4.2% for the second month in a row.
Food spending (up 6.1%) and cafes, restaurants, and takeaway (up 12.7%) bolstered the overall figures – with softening in most other discretionary categories.
Household goods declined year-on-year by 4.4%, marking six months of negative sales growth. You can read our media release here.
The ABS also reported 32,200 retail job vacancies as of May 2023 – a decrease of 13% compared to February 2022.
While the decline is welcome, it is likely a consequence of retailers limiting hiring due to financial constraints. You can read more about that here.
